Maldonado’s family farm settles tax bill with IRS

The lieutenant governor’s brother and father paid $111,146 in back taxes Monday but said they were doing so “under protest” because they dispute the charge.

California Lt. Gov. Abel Maldonado’s family farm paid $111,146 in back taxes Monday, following reports in The Times that the federal government had placed a lien on the business.

Maldonado’s campaign manager sent media organizations a copy of an IRS lien release Monday afternoon, saying the document had been obtained earlier in the day after a representative of the Maldonado farm delivered a check to the IRS offices in Santa Maria.

Accompanying the lien was a statement that said Maldonado “advocated paying the IRS bill off as soon as it was presented,” but he was outvoted by the other two board members of Agro-Jal Farming Enterprises: his father and his brother.

The statement, from the lieutenant governor’s brother Frank, said the company paid the tax “under protest” because it disputes the charges. But he and his father decided to pay the tax to avoid more bad publicity.

“What two of us failed to realize was that even if Agro-Jal’s actions were 100% proper, the lien filed while we were disputing the bill would cause great political embarrassment to Abel,” the statement said.

Maldonado’s campaign manager, Brandon Gesicki, said the tax dispute involves use of about a dozen Ford F-150 pickup trucks driven by company officers, including Maldonado’s father, mother and sister. The federal government contended that the trucks were being used as personal vehicles and demanded that the company pay taxes on them like other forms of employee compensation, Gesicki said.

The company argues that the trucks are being used for business purposes, Gesicki said.

An IRS spokesman said he could not authenticate the lien release late Monday because the Cincinnati office responsible for verifying such documents was closed for the day.

The IRS filed the lien April 13, two weeks before Gov. Arnold Schwarzenegger swore in Maldonado as the state’s second highest-ranking public official. The action marked the ninth time since 1992 that federal, state or local tax collectors had resorted to liens against the business in an effort to compel payments totaling more than $240,000, public records show.

Schwarzenegger appointed Maldonado lieutenant governor after the office was left vacant by John Garamendi’s election to Congress. Maldonado, a Republican, is running for reelection in November against Democratic San Francisco Mayor Gavin Newsom.